You know that they owe you the money but a Court needs proof.

Documenting your transaction is a usual business practice but often when creditors are trying to collect their debts they will have discussions with debtors who make promises to pay.  These conversations can be vital to recovering the cash if the debtor later tries to avoid liability for the debt.

When ever you have contact with a debtor make a clear file note of the conversation.

Points to record are:

1. The parties to the discussion.
2. Who made contact.
3. What was said, especially admissions of liability, reasons for lateness and promises to pay.
4. Date and time of discussion.
5. Your signature on the note.

These are not difficult to record but can make all the difference to a Summary Judgment claim succeeding in the face of a denial of liability.

Courts look for notes made at the time as reliable proof of admissions.

Often faced with such proof debtors will give up their denials and accept liability.  A similar note should be made of any contact with lawyers representing debtors.

A simple note with all the elements could look like this.

• Rang John Smith.
• He apologised for not having paid the $40K he owes due to delayed title on the properties he is hoping to sell.
• He says title is due next week and he will be in a position to pay $35k by the 20th and the balance a week later.
• “Signed” J Bloggs 4.10pm 6/6/06

Make a suitable note for every contact with the debtor.  Even notes of promises to ring back which are not kept can be important (they may later claim not to have had any contact).

Put the notes on the file and give them to your solicitors if you need to take recovery action.

Speed of action is also very important.  The sooner you put on the pressure the more likely you are to get your money into your bank account where it belongs.  This also applies once you have tried but failed to get the money yourself.  Do not delay passing the debt to your experienced debt collection professional.